Bill Martin, President of Central Council Tlingit & Haida Indian Tribes of Alaska (Central Council) and Chris E. McNeil, Jr., Sealaska President & CEO are pleased to announce that a Memorandum of Understanding (MOU) was signed on March 27, 2009 between Central Council and Sealaska. The MOU is a historic agreement and strengthens opportunities for shareholders and members of both Native organizations. The intent is to provide business opportunities that will meet mutual objectives, including exploring business partnerships and investment opportunities in the region.

“This is a challenging time for Southeast Alaska but there is potential for developing innovative and sustainable economies in Southeast,” stated McNeil. “Collaboration amongst these Native institutions represents a new model to discovering solutions that will strengthen our region and benefit tribal members and Sealaska tribal member shareholders.”

Sealaska and Central Council will work to identify and evaluate strategic plans then consider acquisition or startup of operating enterprises. The primary goals of the MOU are to:
Research new opportunities to  improve the economic conditions of and employment opportunities for the  Tribe’s members and Sealaska’s tribal member shareholders
Generate revenue for the Tribe and  Sealaska
Enhance the Tribe’s economic  self-sufficiency and self-determination
Increase benefits and employment  opportunities for tribal members and Sealaska tribal member  shareholders
Enhance Sealaska’s access to  contract opportunities

“During this struggling economy it is important that we obtain maximum funding for our region through the stimulus act,” said Martin. “I look forward to the Tribe working cooperatively with Sealaska to bring economic and employment opportunities to our tribal citizens and shareholders.”

Central Council and Sealaska will focus on U.S. Small Business Administration 8(a) federal contracting and mentor/protégé programs, renewable energy projects, labor force training and deployment, tourism and community infrastructure development.

“The board of Directors, Sealaska management and our subsidiaries are working together to increase our economic activity in Southeast,” said Sealaska Director Tate London. “This MOU aligns well with that vision and is an important step that will build off the collective strength of Sealaska and Central Council,” said London.

Presidents Martin and McNeil’s vision is to jointly develop enhanced revenue for the Tribe and Sealaska through future partnerships. Sealaska and Central Council will initially focus on the opportunities available by passage of the American Recovery and Reinvestment Act (stimulus package).

“I was approached by members of the Alaskan Federation of Native with concerns about this provision,” said Rep. Young.  “I told them that no matter if I supported this bill or not, I would make sure they were not hurt by it.  These programs are a success and are working just as Congress intended.

“These programs” include the successful ANC SBA 8(a) program.  Here is the actual provision removed.

PROHIBITION ON NO-BID CONTRACTS AND EARMARKS

Sec. 1608. (a) Notwithstanding any other provision of this Act, none of the funds appropriated or otherwise made available by this Act may be used to make any payment in connection with a contract unless the contract is awarded using competitive procedures in accordance with the requirements of section 303 of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253), section 2304 of title 10, United States Code, and the Federal Acquisition Regulation.

(b) Notwithstanding any other provision of this Act, none of the funds appropriated or otherwise made available by this Act may be awarded by grant or cooperative agreement unless the process used to award such grant or cooperative agreement uses competitive procedures to select the grantee or award recipient.

Sealaska Environmental Services (SES) along with two other contractors have each being awarded a firm fixed price, indefinite delivery indefinite quantity environmental multiple award contract for environmental remediation services on Navy and Marine Corps installations.  The maximum dollar value for all three contracts combined is $50,000,000.

SES is a wholly owned subsidiary of Sealaska Corporation founded in 2003.  SES is in the SBA 8(a) program  and headed by Sealaska shareholder Derik Frederikson.

For the full, unbelieveably dense Dept. of Defense press release, click here.

October 30, 2008

Facing a Loss in Alaska

By WELD ROYAL

The Alaska Native corporations have had Senator Ted Stevens to thank nearly every step of the way.

In 1971, a few years after he was first elected to the Senate, Mr. Stevens helped write the Alaska Native Claims Settlement Act. Also known as the “Billion Dollar Deal,” the act established more than 200 corporations to manage almost 45 million acres and gave $962 million to Alaska Natives in return for their ceding of all aboriginal land rights.

When the Alaska Native corporations struggled in their early years as they tried to turn people who had survived on fishing and hunting into business managers and to teach thousands of villagers to call themselves shareholders, Senator Stevens was there, too.

He helped corporations with financial difficulties by persuading Congress to approve a provision in the 1986 Tax Reform Act allowing the corporations to sell their accumulated tax losses to profitable companies seeking tax write-offs.

That same year, Senator Stevens introduced legislation that allowed Alaska Native corporations to participate in a Small Business Administration 8(a) contracting program, a provision that has proven lucrative to many of them.

And just a month ago, in the wake of questions that some of the corporations were misusing the contracting program, he successfully pushed Congress to remove a provision from the 2009 Defense Authorization Act that would have limited their access.

After his conviction on Monday on charges he violated federal ethics laws by failing to report tens of thousands of dollars in gifts and services he had received from friends, Senator Stevens’s future in Congress is uncertain.

But Louis A. Thompson, 72, who has run one of the corporations, Kavilco Inc., for 36 years, said the companies had grown into sophisticated operations that could stand on their own. “Senator Stevens was very helpful early on and not just to Alaska Native corporations, to all Alaskans,” he said. “But times have changed.”

Indeed, the Alaska Native corporations have made strides since the early days, when they built seafood plants before negotiating for fish deliveries and constructed hotels in remote villages that had never seen tourists. Today, they consistently rank among state’s largest businesses. The small-business 8(a) contracting program has been important to that success.

As of May, 187 Alaska Native-owned companies were participating in the 8(a) program, according to a report by the Small Business Administration’s Office of Inspector General. From 2000 to 2006, Alaska Native corporations won nearly $13 billion in federal contracts.

Maver E. Carey, 41, the leader of one of those corporations, sees the federal contracts as the future of her business. And other small corporations are looking to her to help them navigate the complicated and expensive path to federal business.

Her enterprise, the Kuskokwim Corporation, represents Aniak and nine other remote Alaska communities. Its responsibilities cover a geographic area larger than New England, but without cellphone towers, major road systems or many jobs. “In Kalskag, one of our largest villages, there are 80 homes and 40 of them don’t have running water,” Ms. Carey said.

Kuskokwim’s 2,903 shareholders want regular corporate dividends, and many also seek educational and employment opportunities from the corporation.

Kuskokwim was founded in 1977 when 10 village corporations decided that they did not have the staff or resources to build businesses alone. The merged entity formed a headquarters in Anchorage and eked out dividends primarily through investments in Alaska real estate and a conservative portfolio of stocks and bonds.

Ms. Carey, whose maternal grandparents are Yupik Eskimo and Athabascan Indian, turned to Kuskokwim in 1994 after earning a college degree, working for an engineering firm and being laid off. “My village corporation offered me $9 an hour and I took it thinking I’d continue to look for a real job,” she said. By 2003, after she had worked in every corporate department, the board asked her to become the chief executive.

She pushed diversification, with a goal of building Kuskokwim’s shareholder equity to $100 million by 2015. Last year, it topped $18 million, up from $14 million in 2006. In 2005, the company started TKC Development Inc. to focus on federal contracting. TKC subsidiaries have won work from the United States Navy and the Army Corps of Engineers.

Last year, Ms. Carey started an Alaska Native village corporation association. Her inspiration came from conversations with other chief executives facing challenges similar to her own. A membership drive under way has registered about 50 Native corporation executives.

Their goal is to be as successful as the Afognak Native Corporation, one of Alaska’s largest businesses. Afognak is owned by 700 shareholders descended from the Alutiiq people of the Kodiak Archipelago. In 2006, its profits reached $18.8 million on revenue of $537.9 million, the latest figures available. That year, each shareholder received a dividend payment of $21,688. Afognak employs 5,000 people globally, and about 50 of them are shareholders.

Afognak is now run by a non-native chief executive with significant government experience. It won the first of its major contracts in 2000, when it secured a deal to operate Kirtland Air Force Base in New Mexico. In recent years, it has won a contract to build a brigade combat team complex worth more than $100 million at Fort Bragg, N.C., and another worth more than $50 million to renovate the United States Embassy in São Paulo.

Still, there have been questions about the 8(a) contracts that have gone to Afognak and other Alaska Native companies. A 2006 study by the federal Government Accountability Office called for better S.B.A. supervision of Alaska Native corporations that hold 8(a) contracts. The agency’s inspector general is currently conducting an audit of S.B.A. oversight of 10 to 15 of the largest Alaska Native corporations engaged in federal contracting.

In August, it found that two companies, Goldbelt Raven L.L.C., owned by Goldbelt Inc. of Juneau, and APM L.L.C., a subsidiary of the Cape Fox Corporation of Ketchikan, violated terms of the contracting program by entering into agreements that resulted in millions of dollars in 8(a) revenues being paid to companies owned by non-native managers. The administration suspended them from the program and moved to end their eligibility. Both companies are appealing the move, according to officials representing Goldbelt and APM.

Steve Colt, the interim director at the Institute of Social and Economic Research at University of Alaska, who has studied Alaska Native corporations, said that many of the corporations struggled to stay afloat in their first two decades of operations and that Mr. Stevens and the rest of the Alaska delegation worked hard to keep them in business.

“If you look at the historical record, there were lots of incidents of Stevens being very helpful to Alaska Native corporations,” Mr. Colt said. “But I suspect that the number of assists has decreased over time.” He predicted that whoever holds the United States Senate seat for Alaska in the future will fight for legislation that protects Alaska Native corporations because they now have a major impact on the state’s economy.

Julie Kitka

October 16, 2008 at 9:23AM AKST

An editorial in the Anchorage Daily News on Oct. 7 (“No-Bid Preferences”) irresponsibly indicts Alaska Natives for the alleged impropriety of two companies associated with a recent and isolated Food & Drug administration government contract.  It also illustrates a fundamental misunderstanding of our history, the work of our business leaders and employees, our contribution to our country and the greater Alaska economy.

The U.S. Congress settled the land claims of Alaska Natives on Dec.18, 1971. The settlement was the largest, most complex Indian land settlement in the history of the United States. In addition to retaining 44 million acres of our original homeland, the Congress authorized Alaska Natives to organize and set up corporations to hold our land and resources. Our Native people were each issued 100 shares of stock in the newly formed Native corporations. We became shareholders and had to learn quickly what that meant and what the corporate structure was all about.

It is 37 years since the initial settlement and we have gained an incredible amount of experience with the corporate structure, with economic decision-making and competing in our rapidly changing capitalistic society. Over the years, we have made mistakes and we have learned. Now, many of our Native corporations are very successful. We have Alaska Native people at the helms of these economic engines. We are proud to contribute to both the Alaska and U.S. economy in significant ways.
The Anchorage Daily News editorial on government contracting was a huge disappointment to us. First of all, it tarred and feathered us all. It did not distinguish between our companies who are working hard and delivering real value and savings to the U.S. government — following the rules and exceeding government standards and expectations — and those few who may have made a mistake and must be accountable for their actions.

Congress authorized and required us to use corporations to implement our settlement. And Congress authorized Alaska Natives to participate in the Small Business Administration’s 8(a) Businesses Development Program. The purpose of the U.S. national Indian policy in the 8(a) program was to allow our businesses to participate in the work the government was contracting out to the private sector. It was to allow our Native shareholders to benefit from our successful completion of government work, which met strict standards. If we were not successful in delivering quality work on time, within budget and within appropriate standards to the government, we would not be successful in competing for other work. This 8(a) government contracting is not a handout.

In many ways, Alaska Native corporations cannot be compared to any other business in America. The U.S. Congress created a vast experiment in 1971 and its success and failures have never been fully documented.  When I talk to respected individuals around the world, they are amazed by what has happened with our land claims. For example, Hernando de Soto, a world renowned Peruvian economist told us this: “Alaska Natives are living proof that life is not a roll of the dice, harsh and brutal.  Government can set in place policies and structures to allow people to help themselves”. When de Soto told us this I was amazed — someone saw what was happening in Alaska. He saw how hard the Alaska Native community was working to make our land settlement a success; he saw how we have shaped the corporate structure with our own values and culture; and saw that we are a contributing member of society.

The 8(a) program is allowing Native Americans, including Alaska Natives, to help ourselves and contribute here in Alaska and across the country. Unlike other 8(a) businesses that are individually owned, Alaska Native corporations are charged with the monumental task of lifting entire communities — representing hundreds, and often thousands of disadvantaged individuals. Therefore, placing caps on awards Alaska Native corporations receive through the 8(a) program or eliminating our corporations’ ability to create subsidiaries with the 8(a) program would suffocate the ability of our corporations to build capacity and expertise which is needed to compete in the global economy and greatly reduce the dividends, scholarships and our efforts to lift our people out of poverty. It would turn the clock back on the very people our government reached out to help.

As with industry, Alaska Native corporations that do not follow the rules and regulations of the 8(a) program must be disciplined individually — not collectively.  The Anchorage Daily News’ advocacy for collective punishment of all our corporations would condemn the entire Alaska Native population to further reliance on the American taxpayer, rather than furthering the cause of self-determination and economic independence.

Alaska Native businesses support 20 percent of Alaska’s population. In 2006, they generated a combined payroll of $695.25 million to over 15,000 Alaska employees, over $1.11 billion in payroll to almost 40,000 employees worldwide, and paid over $60 million in federal taxes. Progress has been made, but much more must be done. Dramatic economic disparity between Alaska Natives and other Americans still exists and must be overcome. Disparities continue in education, in health and life expectancy, even infant mortality. The Alaska Native leadership is committed to doing everything we can to eliminate the disparity in life opportunities and create a chance for every child to have a healthy and productive future.

It is unfair and irresponsible for your paper to call for sweeping changes to a government initiative which is working. On behalf of the Alaska Native leadership, we ask the Anchorage Daily News to retract their editorial and provide us an opportunity to meet to discuss your concerns.
Julie Kitka is president of the Alaska Federation of Natives

By Robert O’Harrow Jr.
Washington Post Staff Writer
Thursday, October 2, 2008; A01

The U.S. Food and Drug Administration had an image problem. For months last year the agency had been pummeled by Congress for poor inspections of tainted vegetables, drugs and other products.

FDA leaders decided to hire a contractor for a public relations campaign that would “create and foster a lasting positive public image of the agency for the American public,” according to agency documents.

A competition, as prescribed by government policy, was not held to get the lowest bid for the $300,000 contract. Instead, FDA officials came up with a plan to ensure the work would go to a Washington public relations firm with ties to the FDA official arranging the deal, according to an examination by The Washington Post.

The plan used a circuitous route around the standard government contracting procedures. The contract was awarded in July to Alaska Newspapers Inc., a firm owned by an Alaska Native corporation that does not have to compete for federal work because it qualifies for special set-asides. The idea was for ANI to hand over the work to Qorvis Communications, the Washington firm, documents show.

After being made aware of The Post’s findings, FDA deputy commissioner John Dyer said this week that he had suspended the contract and ordered an independent investigation.

“Whatever the findings are on this one contract, the FDA has full confidence in the integrity of its contracting procedures as verified by independent third-party reviews conducted several times a year,” Dyer said in a statement Monday.

ANI and its parent company, Calista Corp., did not return repeated phone calls seeking comment.

The story behind the FDA’s public relations deal, drawn from interviews and dozens of e-mails obtained by The Post, offers insight into how contract competition requirements designed to get the best deals for taxpayers have often been subverted in recent years for the sake of convenience or to serve narrow interests, according to a congressional study and contracting specialists.

With unusual candor, people involved in the FDA deal discussed the fact that ANI was brought in so the FDA could work with Qorvis, e-mails show.

While the deal was being formulated last October, James Dunn, a private consultant who had dealings with ANI, sent the following e-mail to a Qorvis executive, who forwarded it to an FDA official: “ANI will gladly serve as a prime for Qorvis on the FDA deal, knowing that the agency would intend to direct them to you as a subcontractor to perform all the work.”

Steven Schooner, co-director of the government procurement law program at George Washington University, said he has rarely seen such a detailed example of officials and contractors working to avoid competition.

“The story line is as bad as anything I’ve ever heard,” he said. “It’s not transparent. It’s not competitive. It’s not arm’s length.”

Rep. John D. Dingell (D-Mich.), chairman of the Committee on Energy and Commerce, which oversees the FDA, said his panel also would investigate the contract.

“The agency chose to use its limited resources to save face instead of saving the public health,” said Dingell, whose committee has led the oversight of the FDA. “This sham of a contract calls into question the integrity of federal contracts awarded to small businesses and Alaska Native corporations.”

The FDA has struggled for years to fulfill its consumer safety mandates, including repeatedly failing to identify the produce responsible for salmonella outbreaks. Lawmakers have held more than a dozen hearings on FDA operations since 2006 and two congressmen alleged that the “mismanagement of its resources has been staggering.”

One FDA response was to ask for more money from Congress — $275 million. Another was to launch a public relations campaign to “inform the American public about the good work that FDA is doing for them.”

Tasked with the public relations job was Mildred Cooper, a temporary FDA consultant hired on a two-year contract to advise FDA Commissioner Andrew C. von Eschenbach and other officials. Hired in March, Cooper became an FDA civil servant.

Cooper, who had worked on Capitol Hill and in public affairs for the Federal Emergency Management Agency and Defense Department, called a friend at Qorvis, which specializes in corporate communications.

Before she joined the FDA, Cooper had worked with Qorvis as a public affairs executive at Luna Innovations, a company that sells medical devices and other products and whose clients include the Defense Department.

“I had experience with Qorvis,” she said in an interview. “We thought they could help with our communications effort. . . . It was a matter of efficiency.”

She was referred to Don Goldberg, who helps lead Qorvis’s crisis communications practice and had once served as part of President Clinton’s crisis management team.

Goldberg told The Post in an interview that he and Cooper talked about improving the FDA’s image. He thought the job could lead to more work with the FDA and enhance the firm’s credibility in the health-care industry; Qorvis also represents PhRMA, the drugmakers trade group.

He and Cooper also discussed speechwriting and media training for von Eschenbach and other agency leaders.

“My impression was she was working closely with the commissioner and chief of staff,” Goldberg said. “My recollection was they wanted to hire Qorvis. It was not appropriate to hire Qorvis directly.”

Goldberg discussed the project with Dunn, a business consultant working with Qorvis, e-mails show. They decided to arrange for Qorvis to come into the project through ANI, the Alaska newspaper company, which runs several weeklies and a small public relations office.

Dunn, who works for a firm called Red Team Consulting, told The Post he had experience with the set-aside rules for Alaska Native corporations because he had worked for one as chief operating officer. Dunn, Qorvis and ANI had all worked on a $29 million Army National Guard marketing contract in 2007.

“They’re a go if you like,” Dunn wrote to Goldberg in an Oct. 18 e-mail that was forwarded to Cooper. “I have a call with ANI on other [matters] in a few minutes. I’ll call you right afterward.”

Cooper asked Goldberg the next day: “Could you please tell me what ANI stands for or what the Web site is?”

That same day, Cooper sent a note to Jane Peterson, an administrator in the FDA chief of staff’s office: “It is possible that Qorvis Communications can execute the program as a sub-contractor to Alaska Newspapers Inc. — which would be the primary contractor.”

Peterson declined to be interviewed by The Post.

Other e-mails show that Cooper apparently allowed Qorvis to tailor terms of the contract known as the scope of work.

On Dec. 6, Cooper e-mailed Goldberg: “I am working on a draft scope of work that would be helpful for you to review.” After Cooper sent the draft to Goldberg, he edited it and added details. “Mildred — take a look at the deliverables I added to the end of the document and see what you think,” he wrote.

Goldberg also e-mailed two memos to Cooper “essentially setting out the process for making this award to ANI and Qorvis.” The memos cited federal regulations and exemptions that might allow the FDA to give the contract to ANI and then direct the work to Qorvis.

Two weeks later, Cooper forwarded the memos to Peterson. “I know you are swamped with emails but just want to keep this on the radar screen,” Cooper wrote, signing off with “:-).”

Up to then, no one from ANI appeared to be a part of the contract discussions, according to the e-mails. On Feb. 13, Goldberg forwarded a note to Cooper from “the ANI team contact.” That day, the contact, Washington public relations veteran Aaron Guiterman, wrote to Goldberg, Qorvis and ANI that “the most likely next step with the FDA is for ANI to submit a proposal.”

In a brief interview, Guiterman said he was not permitted to speak about the contract.

Goldberg said he did nothing wrong in pursuing the contract and left the details to Cooper.

“I assumed this was all what Mildred was working out with them,” Goldberg said. “I never talked to the contracting officers and would never say to Mildred, ‘Deceive your contracting officers.’ ”

Dunn also said he would never advise clients to do anything that might violate federal regulations.

On July 23, after more deliberation, the FDA issued a $300,000 purchase order for the public awareness campaign, with ANI listed as the contractor. An FDA official said ANI had pledged in writing to do more than half the work.

The FDA said this week that it had suspended the contract before any money changed hands.

Dyer said he does not believe von Eschenbach or other senior officials knew what Cooper was doing. “From what I can tell, it was Mildred trying to drive it,” he said. “Whatever she did with Qorvis does not represent the agency.”

Cooper said she was only trying to help the agency.

“My role was to assist with that very important effort,” Cooper said. “If anything improper was done, it was done unknowingly.”

Staff researcher Lucy Shackelford contributed to this report.

Through his speech and the Q & A section, the Senator addressed many issues on the minds of SE Natives. He spoke most passionately about issues I happen to also feel very strongly about. These include the current situation of our villages and the feeling of young people “not having hope”. This is a serious problem.

Senator Stevens said “the Alaska Native Claims Settlement Act would not be passed today.” He said “times have changed”. I could not agree more. The perception of Native Americans in general has changed dramatically since the early ’70s.

Video provided by True North Video Productions, LLC.